The BSE Sensex & Nifty 50 rose by 1.44% and 1.55% respectively aligned with global markets. On 27th August, all sectoral indices gained. Investors’ sentiments were boosted after U.S. Federal Reserve Chairman Jerome Powell’s remarks at the Jackson Hole Symposium on tapering of asset purchases program.
On domestic front, Government off India announced a plan to monetise government assets to moblize about Rs 6 trillion to fund its infrastructure project over a four-year period. Approximately, Rs 880 billion worth of assets will be monetised this year.
Next week, Sensex and NIFTY are expected to touch new peak as investors expectation is likely to remain bullish.
FIIs/FPIs have sold Rs. 113 billion in July 2021 and invested Rs. 9.86 billion in August 2021 (as of 29th August 2021).
Global equities now worth $118.6 trillion, the highest value ever in history which is equals to around 140% of world GDP.
Wallstreet indices continued to move higher from previous week, S&P 500 & Nasdaq touched new highs after Fed Chair Powell indicated that the central bank would taper by the end of the year. Moreover, the US Food and Drug Administration (FDA) fully approved the Pfizer-BioNTech COVID-19 vaccine which strengthened market sentiment for expedition of economic recovery. The US economy advanced an annualized 6.6% on quarter in Q2 2021, slightly higher than 6.5% in the advance estimate During the week, Dow Jones gained by 0.95%, Nasdaq rose by 2.8%, and S&P 500 up by 1.5%.
European stocks closed higher on Friday following US stock indices. During the week, FTSE rose by 0.86% and DAX up by 0.3%.
The Baltic Exchange Dry Index gained 1% to 4,235 on Friday which is more than 11-year high level.
Global Economy
US core PCE prices rose by 0.3% n monthly basis in July of 2021, following an upwardly revised 0.5% rise in June and in line with forecasts. The annual rate stood steady at 3.6% as per market expectations.
The US economy expanded by 6.6% in Q2 2021 higher than 6.5% in the advance estimate. Upward revisions to non-residential fixed investment stood at 9.3% from 8% in the advance estimate while and exports came in at 6.6% from 6% in the advance estimate.
US personal spending rose by 0.3% on monthly basis in July of 2021 as compared to 1.1% rise in previous month and matching market forecasts.
US new home sales increased by 1% to a seasonally adjusted annual rate of 708,000 in July of 2021, in line with forecasts of 700,000 and following a downwardly revised 2.6% drop in the previous month. It was the first rise in 4 months
US crude oil inventories declined by 2.979 million barrels to the lowest level since January of 2020 in the latest week which is more than market consensus of 2.683 million fall.
US Markit Composite PMI came down for the third month in a row to 55.4 in August 2021, from 59.9 in the previous month and well below market consensus of 58.3 as per preliminary estimation.
UK Markit Composite PMI fell to 55.3 in August 2021, from 59.2 in July and below market consensus of 58.4 as per preliminary estimation.
